Detroit reaches dead end unless White House intervenes
Summary: It's all over but the recriminations and finger-pointing. This calendar year there'll be ZERO loans approved in Congress for the Detroit Shrinking Three automakers.
It's all over but the recriminations and finger-pointing. This calendar year there'll be ZERO loans approved in Congress for the Detroit Shrinking Three automakers. Any federal action to prevent the threatened implosion of General Motors, still the number one selling auto maker in the U.S., will have to come from executive action. This is likely to happen. Of course, the current administraton has less than forty days left in power, then it's the next guy's problem. But again it looks unlikely any loan package would get approved by the U.S Senate even after it reappears in its new composition in January.
White House. Courtesy U.S. government.
One administration spokesman said, "Because Congress failed to act, we will stand ready to prevent an imminent failure until Congress reconvenes and acts to address the long-term viability of the industry." Expect these loans to have few requirements for the automakers. It's likely to be much like the money doled out to financial corporations by the Treasury Department and Federal Reserve. "Here. Enjoy. Happy Holidays."
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Any money from the Treasury Department would apparently have to come from TARP, those hundreds of billions first earmarked for the financial industry only.
So many things are at stake in this drama. For our purposes the future of the Chevy Volt, a promised plug-in electric car is of interest. Will there be any loan provisions that require or ignore alternative energy sources for cars. It's already clear the domestic ethanol industry is having some trouble.
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Talkback
It appears to me the green movement may have killed green cars.
I would have liked to have seen the Volt, but the people who want Chevy to go green may have killed it. Why? Because they weren't satisfied. They wanted to do it before the manufacturers were ready. They were too impatient.
They need to retool their factories to go green. But the extremist environmentalists want them to go green before they retool. Nevermind that the whole reason for retooling is to go green.
It's like saying "I want you to finish the house in a week, but the tools you need won't get here until next month."
The truth? You can never satisfy the extremists, no matter how much you try. And there are plenty of extremists in the "green" movement. Many of them are practically Luddites.
Toyota is doing well
Now they're paying the price.
We shouldn't be interfering in the economic cycle like this.
There are small auto makers of electric etc vehicles in the US, just let them grow. (give them the money).
They were only buying time
"Preparing to go green"??
Admittedly, you need bigger cars than in other countries because you're all so fat and can't stop eating too much, but ultimately, this is the auto makers just desserts.
RE: Detroit reaches dead end unless White House intervenes
GM and Chrysler did it, the State of California does it, even the US government does it. In my home, I can't continually spend more money than I make, sooner or later that will catch up with me. I can't figure out why people think businesses and governments are some magical entities that have endless supplies of cash.
Yes.
The large car market dies, trouble. Foreign makers are not affected by CAFE, since few range rovers and land cruisers are released here, flooded everywhere else.
On the deficit spending, we have, for the most part, become an instant gratification society, encouraged to be that way. We are must have new car every 3 year, new iPod at all costs, new furniture, every gadget must have or you are nothing society.
TripleII
We'll see. I'd like to see the Volt arrive.
The answer was "No". As one who has watched all the strikes over 25 years, all the incredible perks mandated by the big 3 unions over that time, and the inability of any political self serving entity that started as a union to concede anything, I think Chapter 11 is here.
Good thing is, now they will be neutered by a Judge, with no leverage, instead of even remotely being on their own terms. You know, it makes you wonder how much it would cost for GM to move it's operations to a "right to work" state?
Well, for those workers who I want to see have jobs, I want to buy American, always, it's time to fire your union. As even Democrats who disapprove of the original bill say "This was a bailout of the UAW".
TripleII
GM workers cost $69 per hour (including pensions etc)
It's clear that the management ($24m/year for the CEO) and the unions have been cropping off the profits, and together decided not to invest in updating equipment, but instead take the money now. They did it to themselves.
How a business can go with a begging bowl to the government is beyond me, where is their pride? The government doesn't have *any* money, they get it from joe public. So GM really want the hard pressed taxpayer to bale them out because they chose not to invest in their own future.
Disgusting.
RE: Detroit reaches dead end unless White House intervenes
Like De La Fontaine said in one of his fable:
"What were you doing all summer long? Singing? Well now do some dancing!!!"
Maybe americans should respect french author a bit more, it would teach them great lessons in life instead of pretending to be god and crushing anyone in their way...
I hope you all go bankrupt...without any compensation!! And your little investors too!!!
Well, aren't you sweet, GuardianRob...
Well, here's a "back at ya" holiday wish. GFY and the "G" stands for "go".
France is a very good country to live in
As to the rioting in Greece, remember the rioting in Seattle 1999, during the G8 meeting? It's something like that, and like what happened in Genoa Italy in the following G8 meeting, all completely different from what happened in France.
Bankruptcy is your friend
In any event, I'd say it's 99% certain the UAW will get its money sooner or later. On November 4th the country took a sharp lurch to the left. Unions will not only survive but prosper.
Cerberus, Chryco's parent company...
It Appears that at least Harry will have a wonderful Christmas
The intersting question still remains: Does Harry view the laid off workers as people, or just so much canon fodder?
Now, I am not a fan of the UAW Union, which is the real problem that the automobile manufactures have been shackled with, and it would be nice to see them go, not the workers.
But Harry is content in the knowledge thatit will not effect his income, or his family's
It may even give him more to write about: I would not be surprised to see his next articles be based on the premise of "How the government let the auto workers and their families down by not approving the bailout".
Just my take as this gentleman seems all too eager to see the companies close and the workers out on the street.
Canon fodder.
No bailout without UAW concessions
The United Auto Workers are not just grossly overpaid. They are obscenely overpaid. I?m normally a bleeding-heart liberal, but not when it comes to the obnoxious attitude of entitlement displayed by the UAW refusing mid-contract wage cuts, but still expecting taxpayers to bail out the industry. I say, if they refuse to take a 15-20% pay cut to bring them in line with workers at their non-union competitors, then let them see what it?s like making only 55% of their current wage (pre-tax) on the unemployment line. I?m for saving jobs, not for saving gluttony.